Financial regulation is a form of regulation or supervision, which subjects financial institutions to certain requirements, restrictions and guidelines, aiming to maintain the integrity of the financial system. This may be handled by either a government or non-government organization. Financial regulation has also influenced the structure of banking sectors by increasing the variety of financial products available. Financial regulation forms one of three legal categories which constitutes the content of financial law, the other two being market practices, case law.
In financial services, a broker-dealer is a natural person, company or other organization that engages in the business of trading securities for its own account or on behalf of its customers. Broker-dealers are at the heart of the securities and derivatives trading process.
The Securities Exchange Act of 1934 is a law governing the secondary trading of securities in the United States of America. A landmark of wide-ranging legislation, the Act of '34 and related statutes form the basis of regulation of the financial markets and their participants in the United States. The 1934 Act also established the Securities and Exchange Commission (SEC), the agency primarily responsible for enforcement of United States federal securities law.
Penny stocks, also known as micro-cap stocks, nano-cap stocks, small cap stocks, or OTC stocks, are common shares of small public companies that initially trade at low prices per share. It is also a term for inexpensive stocks that subsequently become highly lucrative holdings.
The OTC (Over-The-Counter) Bulletin Board or OTCBB is a United States quotation medium operated by the Financial Industry Regulatory Authority (FINRA) for its subscribing members.
Securities regulation in the United States is the field of U.S. law that covers transactions and other dealings with securities. The term is usually understood to include both federal- and state-level regulation by purely governmental regulatory agencies, but sometimes may also encompass listing requirements of exchanges like the New York Stock Exchange and rules of self-regulatory organizations like the Financial Industry Regulatory Authority (FINRA).
Securities fraud, also known as stock fraud and investment fraud, is a deceptive practice in the stock or commodities markets that induces investors to make purchase or sale decisions on the basis of false information, frequently resulting in losses, in violation of securities laws.
A financial adviser or financial advisor, is a professional who suggests and renders financial services to clients based on their financial situation. In many countries financial advisors have to complete specific training and hold a license to provide advice. In the United States, a financial adviser carries a Series 7 and Series 65 or Series 66 license. According to the U.S. Financial Industry Regulatory Authority (FINRA), license designations and compliance issues must be reported for public view. FINRA specifies the following groups who may use the term financial advisor: brokers, investment advisers, private bankers, accountants, lawyers, insurance agents and financial planners.
A self-regulatory organization (SRO) is an organization that exercises some degree of regulatory authority over an industry or profession. The regulatory authority could exist in place of government regulation, or applied in addition to government regulation. The ability of an SRO to exercise regulatory authority does not necessarily derive from a grant of authority from the government.
The Series 7 exam, also known as the General Securities Representative Exam (GSRE), is a test for entry-level registered representatives. The Financial Industry Regulatory Authority (FINRA) administers the exam. In the United States, financial professionals take this test to become qualified to purchase and/or sell security products such as: corporate securities, municipal fund securities, options, direct participation programs, investment company products and variable contracts.
NYSE Euronext, Inc. was a Euro-American multinational financial services corporation that operated multiple securities exchanges, including the New York Stock Exchange, Euronext and NYSE Arca. NYSE merged with Archipelago Holdings on March 7, 2006, forming NYSE Group, Inc. On April 4, 2007, NYSE Group, Inc. merged with Euronext N.V. to form the first global equities exchange, with its headquarters in Lower Manhattan. The corporation was then acquired by IntercontinentalExchange, which subsequently spun off Euronext.
Best execution refers to the duty of an investment services firm executing orders on behalf of customers to ensure the best execution possible for their customers' orders. Some of the factors the broker must consider when seeking best execution of their customers' orders include: the opportunity to get a better price than what Is currently quoted, and the likelihood and speed of execution.
Extended-hours trading is stock trading that happens either before or after the trading day of a stock exchange, i.e., pre-market trading or after-hours trading.
A multilateral trading facility (MTF) is a European regulatory term for a self-regulated financial trading venue. These are alternatives to the traditional stock exchanges where a market is made in securities, typically using electronic systems. The concept was introduced within the Markets in Financial Instruments Directive (MiFID), a European Directive designed to harmonise retail investors protection and allow investment firms to provide services throughout the EU.
A trading halt occurs in the U.S. when a stock exchange stops trading on a specific security for a certain time period. The halt, which can happen a few times a day per security if FINRA deems it, usually lasts for one hour, but is not limited to that. Trading halts can happen any time of day. The listed company is supposed to call the exchange where it is listed, 10 minutes prior to any material news that they are releasing, in order for the exchange to halt the stock before the news is released. The first 5 minutes of a halt is for "news pending" before any information is released that could affect a stock significantly, also known as the "5 minute window".
Mary L. Schapiro served as the 29th Chair of the U.S. Securities and Exchange Commission (SEC). She was appointed by President Barack Obama, unanimously confirmed by the U.S. Senate, and assumed the Chairship on January 27, 2009. She is the first woman to be the permanent Chair of the SEC. In 2009, Forbes ranked her the 56th most powerful woman in the world.
Elisse B. Walter was the 30th Chair of the U.S. Securities and Exchange Commission (SEC) from December 14, 2012 – April 10, 2013. She was appointed Chair by President Barack Obama on November 26, 2012, and sworn in on December 14, 2012. She was originally appointed as one of five SEC Commissioners by President George W. Bush and sworn in on July 9, 2008. Under designation by President Obama, she later served as Acting Chair during January 2009. She served as a Commissioner of the SEC until August 9, 2013.
A Swap Execution Facility (SEF) is a platform for financial swap trading that provides pre-trade information and a mechanism for executing swap transactions among eligible participants.
The Financial Instrument Global Identifier (FIGI) is an open standard, unique identifier of financial instruments that can be assigned to instruments including common stock, options, derivatives, futures, corporate and government bonds, municipals, currencies, and mortgage products. Also see: Open Data
